3 Simple Steps to Increase Prices

Ultimately, the people who pay for your services are the ones who know best.

Now, you don’t necessarily ask them how much to charge. But you do put a price on the service they inquire about. It’s what you send over in your proposal.

If they say yes, they accept your price as fair and reasonable for the value of the services you offer.

If they say no, they do not accept it, because the cost to them exceeds the value they expect to receive.

It’s that simple.

Here’s the part that’s not as easy to interpret: If they say yes too often, it probably means you’re not charging enough. The value is way more than the price.

Let me say that again for the people in the back (or skimming).

If your conversion rate is too high, you are leaving money on the table.

How come? Because the value proposition you’re offering is so good couples see it as steal-of-a-deal. You know the feeling when you walk out of the store thinking, “I would’ve paid 2x the price for that!” Or, “I have to tell my friends about it because they have to get in on this bargain too!”

8 giveaways it’s time to increase prices

Yeah, if you’re converting at high percentages that’s what couples are thinking/feeling/saying when they sign your contract.

A super-high conversion rate is a dead giveaway that it’s time to raise rates. Here are 7 others:

1.      Ahead of booking pace – You have more events and/or revenue on the books right now than you did at the same time last year.

2.     Overwhelmed with inquiries – If you’re drowning with work (ahem, like pretty much everyone right now), it’s a good idea not to waste time with people who struggle to afford your services.

3.     Strong inquiry demand – You’re swamped with potential clients. Congratulations on your marketing. It means you afford to get a few more nos!

4.     You think you’re full – Your calendar only has so many dates to fill. If you’re limited supply is nearly full, then it’s time to consider raising rates. Go ask your macro-economics professor if you don’t believe me.

5.     Specific dates are filling in quickly during peak periods – Dynamic pricing works well in highly seasonal businesses (like weddings). Charge more for the most popular dates, especially if they’re in limited supply.

6.     Picking the highest package too frequently – If everyone’s buying your most expensive collection, it’s akin to a super high conversion rate. Couples are telling you your best is too affordable to pass up.

7.     Reserves in the bank – Make sure you have a safety net if you don’t book anything for a while with the new/higher prices. You’ll sleep better at night. 

3 steps to increase your prices (and decrease your risk)

Now that you know when to increase prices, let’s talk about how to raise them with a low amount of risk.

1.      First, make sure signs (two or more of the eight indicators above) are pointing toward a price increase.

2.     If that’s the case then push your prices up by 5-10%.

That’s right, take the current prices and multiply by 1.05 or 1.10 and use these on your proposals instead. Delete the old rates and drop in the new ones.

I recommend trying these higher prices for 10 inquiries, because you need a good sample to collect data from for it to mean anything. Bookings can be streaky, and we want to remove some of that margin for error when interpreting the results.

3.     After 10 qualified inquiries come in and you’ve waited for yeses and nos from them, take a look at the conversion rate for these 10. Is it higher, lower, or about the same as your baseline conversion rate?

If it’s the same or higher, you might consider raising prices again by 5-10%.

If it’s significantly lower, you might want to go back to the previous prices you were charging. But don’t give up! It’s not that you can’t ever charge the higher rates. Remember the value proposition I talked about at the beginning? Yeah, that’s what you have to work on.

If people aren’t paying the rates you want it’s probably because you haven’t built enough value in the buying experience for the couple to feel like your prices are fair and reasonable for what they’re getting.

Work on building value and your prices will increase along the way.

Don’t wait to raise your prices

Remember, you can’t go back in time and raise prices for future dates. There’s no better time than now to (re)consider what you’re charging – especially with all the demand on 2022 dates. In fact, it’s quite likely you’re already a little late in evaluating your current prices.  

Any questions about pricing or raising your rates? Reach out and let us know.